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3rd March, 2015
“Strive not to be a success, but rather to be of value” Albert Einstein
These words have a particular resonance in today’s world as more and more businesses are considering corporate social responsibility (CSR) as part of their business strategy, so what is CSR and how can it benefit you as a business?
CSR describes the principle that companies can and should make a positive contribution to society. CSR is the practice of managing the social, environmental and economic impacts of the company, being responsive to ‘stakeholders’ and behaving according to a set of values. But in practice this can refer to a wide range of actions that companies may take, from donating to charity to reducing carbon emissions.
Your customers, suppliers and the local community are all affected by your business and what you do. Your employees depend on your business, while your products and the way you make them, all have an impact on the environment. CSR is about understanding your business’ impact on the wider world and considering how you can use this impact in a positive way.
However CSR isn’t just about doing the right thing. It means behaving responsibly, and also dealing with suppliers who do the same. It offers direct business benefits including:
Activities such as involvement with the local community are ideal opportunities to generate positive press coverage
A good reputation makes it easier to recruit employees
CSR helps ensure you comply with regulatory requirements
Understanding the wider impact of your business can help you develop new products and services.
Building a reputation as a responsible business sets you apart. Companies often favour suppliers who demonstrate responsible policies, as this can have a positive impact on how they are perceived by customers. Some customers don’t just prefer to deal with responsible companies, but insist on it. “Price is what you pay, value is what you get.” Warren Buffet
You can also reduce resource use, waste and emissions which doesn’t just help the environment – it saves you money too. It’s not difficult to cut utility bills and waste disposal costs and you can bring immediate cash benefits.
Make the most of your CSR activities by publicising them. Ensure that customers, suppliers and the local community know what you are doing. CSR lends itself to good news stories. Publicity like this can be a key part of using CSR to win contracts. People want to buy from businesses they respect. CSR can be particularly effective for targeting ethical companies, the public sector and not-for-profit organisations.
At the same time, you should see CSR as part of a continuing process of building long-term value. Everything you do should help improve your reputation and encourage customers and other stakeholders to stay involved with you. A business that buys recycled paper – but ignores the local community – has missed the point. You could consider working towards a management standard which you can then use to publicise your ethical, environmental or social responsibility…
Effective CSR like this helps you continue to differentiate yourself. Even with dozens of competitors, a real commitment to CSR makes you stand out.
I’ll finish with a quote from Henry Ford, “A business that makes nothing but money is a poor kind of business.”
Carole White, Chief Executive, TEDCO Business Support.
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